Bouteflika has led a vigorous campaign urging voters to back his Charter for Peace and National Reconciliation, a key tenet of which is an effective amnesty for many of the armed fighters who rose up after the army cancelled an election in 1992 which their politicians, members of the Islamic Salvation Front (FIS), were set to win.
The FIS was forced to disband and its leaders, Abbas Madani and Ali Belhadj, arrested and jailed.
The insurgency has claimed around 150,000 lives since 1992, while 40 people have been killed in September during the campaigning.
If approved in Thursday's referendum, the charter would end legal proceedings against detained, exiled or fugitive insurgents "who have already halted their armed activity and surrendered to the authorities".
Only "those involved in mass massacres, rapes and bomb attacks in public places" would be excluded from the amnesty.
Opposition and human-rights groups, however, have urged voters to reject the charter saying it merely sweeps years of suffering under the carpet and gives the president sweeping new powers.
Family of missing people demand
information on loved ones
According to Aljazeera's correspondent in Algeria, Abd al-Haq Saddah, opposition groups have criticised Bouteflika for not addressing the issue of missing people, for which the security forces are being responsible.
The Socialist Forces Front (FFS) says it "cannot endorse a text that glorifies force and deprecates political mediation, consecrates impunity and amnesty, and in the end negotiates away pain and suffering".
There has been some enthusiasm among Algerians living in the inner parts of the country, as they have suffered a great deal more as a result of the conflict, than those living in the coastal areas, reports Saddah.
According to Saddah, the opposition's calls for a boycott are focused on the tribal areas. Therefore, those calls may not affect the voters' participation all over the country. They will affect the tribal areas only.
For its part, the independent League for the Defence of Human Rights (LADDH) described the referendum as "scandalous and absurd", claiming "nobody has a right to vote no".
Jailed FIS leader Abbass Madani
was released in 2003
"We're not against peace and reconciliation, but we do oppose this charter since we don't think it will bring peace," LADDH President Abdennour Ali-Yahia said of the text.
"The head of state will be able to rule by decree and curtail all liberties by claiming that this charter is a people's mandate."
Almost one million Algerians living overseas, including over 750,000 in France, began voting in the referendum on Saturday.